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Thursday

Keurig May Have Overplayed Their Hand With "Coffee DRM"

Keurig Green Mountain made a decision last year to manufacture their single serve coffee machines to only work with their own brand of packaged coffee - so-called "Coffee DRM". DRM refers to Digital Rights Management, a series of techniques long used by (usually) software manufacturers to prevent their software from being illegally copied.

By incorporating changes in their coffee makers Keurig effectively precluded customers from using non-Keurig coffee packs, and apparently it was not a popular (although somewhat understandable) decision. Sales are noticably down, and now the stock is taking a hit. Their CEO just 'fessed up that the DRM decision may have been short-sighted.

CEO Brian Kelley says he's listening to consumers and is ready to
make changes. The biggest frustration for customers is that the 2.0
model only brews Keurig branded coffee cups.

"Quite honestly,
we were wrong. We underestimated the passion the consumer had for this,"
Kelley told analysts on a call Wednesday evening.